Archived press release

Tesco Taking Over High Street

24 June 2005

Tesco's growing market share is bad for British business, bad for consumers, bad for the environment and must be checked, Friends of the Earth said today (Friday 24^th June), as shareholders attend the supermarket giant's annual general meeting [1]. Friends of the Earth is calling for an immediate investigation into Tesco's monopoly position and a moratorium on mergers in the retail sector.

Tesco controls nearly one third of the UK grocery market, with £1 in every £3 spent on groceries spent at Tesco. But MPs at a Friends of the Earth briefing in Westminster yesterday (Thursday) heard how its huge market share was giving it power over suppliers, which set standards for supermarket practice across the retail sector.

Andrew George MP, who hosted the briefing, said:

"Supermarkets are behaving completely rationally in using their muscle in the market place. It's whether they are inappropriately using their power in the supply chain. In my opinion, the evidence shows we are well beyond the time by which some legislation is in fact required."

Friends of the Earth campaigners will be attending the AGM itself, accompanied by farmers, a banana worker and representatives from Women Working Worldwide, ActionAid and National Group on Homeworking to raise questions about the impacts of Tesco on the supply chain.

Tesco boasts about its commitment to fair trade and "corporate responsibility" [2], but a new report from Friends of the Earth shows that Tesco's practices are putting many UK farmers out of business; while on the high street, some 2,000 independent stores went out of businesses in the last year alone, unable to compete with promotions and planning and taxation policies which favour the multiples over smaller shops [3].

Supermarket practices are also driving climate change, the new report reveals, as the rapid growth in trade brings demand for extra transport, refrigeration, heat and light. Tesco claims to have spent £3.7 million on energy saving schemes in the last year, but failed to meet its commitment to cut emissions by 4.2 per cent [4]. Its stores consume nearly twice as much energy as the national average [5].

Friends of the Earth's Supermarket Campaigner Vicki Hird said:

"Tesco is lauded as a British success story but the image is a deceptive one and it is beginning to tarnish. We want shareholders to realise that farmers and consumers are paying the price of their profits. And we want MPs to act to curb the growing market power of supermarkets and ensure that Britain's booming supermarket industry does not kill off farmers, consumer choice and the traditional British high street."

`Tesco Takeover' leaflet (PDF)

And a fuller background briefing on
www.foe.co.uk/resource/briefings/the_tesco_takeover.pdf

Friends of the Earth's briefings on supermarkets and the environment:
www.foe.co.uk/resource/briefings/checking_out_the_environme.pdf (PDF)
www.foe.co.uk/resource/briefings/good_neighbours_community.pdf (PDF)

Notes

[1] The Tesco Annual General Meeting takes place at the QEII Conference Centre in Westminster at 11am on Friday 24^th June 2005 and will be attended by Friends of the Earth.

[2] www.tesco.com/everylittlehelps/

[3] See www.foe.co.uk/resource/briefings/the_tesco_takeover.pdf (PDF)

[4] www.tesco.com/csr/index.html This is also a drop in spend on energy efficiency schemes as they spent £6million in 2003/4

[5] See www.foe.co.uk/resource/briefings/the_tesco_takeover.pdf (PDF)

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Published by Friends of the Earth Trust